2021 Q3 Commercial Insurance Pricing Trends

Dec 22, 2021

Market Observations:

• Market hardening trends persisted for the 16th consecutive quarter as CIAB survey respondents reported an 8.9% premium increase across all sized accounts.

• Pricing increased across all business lines except Workers’ Compensation, which saw a 0.3% premium decrease. This decrease represents Workers’ Compensation’s first pricing reduction in five quarters.

• Once again, Cyber Liability lines set record highs for premium increases, retaining its position as the most troubling line of business. Pricing increased by an average of 27.6% as ransomware attacks continued to plague the market.

• Although slowed in pace, Umbrella/Excess liability lines continued a trend of pricing increases in Q3 2021. Premiums rose 16.9%, down slightly from 17.4% in Q2 2021.

• Directors & Officers’ lines saw a notable 13.6% premium increase.

• Commercial Property lines also continued a trend of double-digit rate increases, experiencing a 10.3% pricing increase.

Looking Forward

Looking forward, while it may be disappointing to read about another quarter mired by pricing increases, there are several positive trends providing hope for the market in the new year. While prices are still climbing, the rising rates have slowed for many lines. Carrier’s appetites for writing new risks seem to be improving for lines like Umbrella/Excess Liability lines, while class action suits seem to be coming at a slower pace in 2021 than they were in 2020 for Management Liability lines.

With all of this being said, Cyber Liability lines will be critical to monitor in the coming year. Advanced planning and preparation for renewals is no longer an option but a requirement. As cybercriminals adapt to new forms of attack, so too must businesses in order to protect themselves from falling victim to a costly data breach.

Source: CIAB Q3 2021 Commercial Market/Casualty Market Index